ONTARIO
SUPERIOR COURT OF JUSTICE, FAMILY COURT
BETWEEN:
Linda Susan White Applicant
Vayia Ellsworth, for the Applicant
– and –
William Gerald White
Respondent
G. Edward Lloyd, for the Respondent
HEARD: April 16, May 28, 2021, Supplementary submissions received May 28, 2021 and June 9, 2021.
RULING ON MOTION
Nicole Tellier J.
OVERVIEW AND PARTIES’ POSITIONS
1This motion concerns the sale of four rural properties owned by the parties during their marriage of 25 years. The applicant wife (“Linda”) asks that 3 properties, which are jointly owned, be sold under sections 2 and 3(1) of the Partition Act, RSO 1990, c P.4. One of those properties is their matrimonial home which has been occupied exclusively by the respondent husband (“William”) since their separation over 3 years ago. Linda claims she was ousted from the matrimonial home when William changed the locks in February 2017 and refused to share the premises post-separation.
2Another property, known as the “farmhouse property”, is tenanted. William has been collecting the rent, paying the related expenses and keeping the net rental income. The third property, known as “the farm” has some outbuildings and cattle on it, raised by William. The nature, size and profitability of that operation is in dispute.
3Title to the fourth property, a woodlot, is in the name of Linda alone but she claims both spouses are beneficial owners; hence she sought leave to sell it. William contends he is the sole beneficial owner of the wood lot, which he harvests.
4There are companion requests for a hold back of some or all of the sale proceeds to secure occupation rent, retroactive spousal support and any post-separation adjustments arising from their maintenance.
5William initially resisted the sale of three of the four properties. He claimed he still needed the matrimonial home, at least for a while, as a base from which to operate the adjacent farm property. During the motion, he ultimately conceded that the matrimonial home and the farmhouse property would be sold. The terms of sale and the distribution of the proceeds were ordered on April 16, 2021, with some provisions being on consent.
6This leaves the determination of the sale of the two remaining properties. William submits that they are both farm properties within the meaning of the Family Law Act RSO 1990, c F.3 (“FLA”) and therefore special considerations under section 11 of the Act are engaged. He argues the motion is premature as the court must first determine any issues of ownership and the equalization obligation and then determine whether there are reasonable alternative methods of satisfying that obligation, which do not require their sale or otherwise seriously impair their operation.
7Linda submits these properties are not farms under the FLA due to their historic lack of profitability. Further, she argues whether they are farms or not, she is entitled to an equalization based on the best or highest values for these properties, which may be more than any appraised value, especially in the current real estate market. She highlights William’s delay in getting any land appraisals or making any concrete offer that would allow him to keep these properties and purchase her interest in them.
8For reasons elaborated below, I find that what the parties call “the farm” is indeed a farm within the meaning of section 11(1) of the Family Law Act. I find the woodlot to be a business within the meaning of section 11(1). Both of these properties shall be listed for sale forthwith.
ANALYSIS
The Statutory Framework
9Section 3(1) of the Partition Act reads as follows:
3 (1) Any person interested in land in Ontario, or the guardian of a minor entitled to the immediate possession of an estate therein, may bring an action or make an application for the partition of such land or for the sale thereof under the directions of the court if such sale is considered by the court to be more advantageous to the parties interested. R.S.O. 1990, c. P.4, s. 3 (1).
10The relevant sections of the Family Law Act are:
Equalization of net family properties Divorce, etc.
5 (1) When a divorce is granted or a marriage is declared a nullity, or when the spouses are separated and there is no reasonable prospect that they will resume cohabitation, the spouse whose net family property is the lesser of the two net family properties is entitled to one-half the difference between them. R.S.O. 1990, c. F.3, s. 5 (1).
Powers of the Court
9 (1) In an application under section 7, the court may order,
(a) that one spouse pay to the other spouse the amount to which the court finds that spouse to be entitled under this Part;
(b) that security, including a charge on property, be given for the performance of an obligation imposed by the order;
(c) that, if necessary to avoid hardship, an amount referred to in clause (a) be paid in instalments during a period not exceeding ten years or that payment of all or part of the amount be delayed for a period not exceeding ten years; and
(d) that, if appropriate to satisfy an obligation imposed by the order,
(i) property be transferred to or in trust for or vested in a spouse, whether absolutely, for life or for a term of years, or
(ii) any property be partitioned or sold. R.S.O. 1990, c. F.3, s. 9 (1); 2009, c. 11, s. 25.
Financial information, inspections
(2) The court may, at the time of making an order for instalment or delayed payments or on motion at a later time, order that the spouse who has the obligation to make payments shall,
(a) furnish the other spouse with specified financial information, which may include periodic financial statements; and
(b) permit inspections of specified property of the spouse by or on behalf of the other spouse, as the court directs. R.S.O. 1990, c. F.3, s. 9 (2).
Variation
(3) If the court is satisfied that there has been a material change in the circumstances of the spouse who has the obligation to make instalment or delayed payments, the court may, on motion, vary the order, but shall not vary the amount to which the court found the spouse to be entitled under this Part. R.S.O. 1990, c. F.3, s. 9 (3).
Ten-year period
(4) Subsections (3) and 2 (8) (extension of times) do not permit the postponement of payment beyond the ten-year period mentioned in clause (1) (c). R.S.O. 1990, c. F.3, s. 9 (4).
Determinations of questions of title between spouses
10.1 (1) The imputed value, for family law purposes, of a spouse’s interest in a pension plan to which the Pension Benefits Act applies is determined in accordance with section 67.2 or, in the case of a spouse’s interest in a variable benefit account, section 67.7 of that Act. 2009, c. 11, s. 26; 2017, c. 8, Sched. 27, s. 21 (1).
Operating business or farm
11 (1) An order made under section 9 or 10 shall not be made so as to require or result in the sale of an operating business or farm or so as to seriously impair its operation, unless there is no reasonable alternative method of satisfying the award. R.S.O. 1990, c. F.3, s. 11 (1).
Idem (2) To comply with subsection (1), the court may,
(a) order that one spouse pay to the other a share of the profits from the business or farm; and
(b) if the business or farm is incorporated, order that one spouse transfer or have the corporation issue to the other shares in the corporation. R.S.O. 1990, c. F.3, s. 11 (2).
Residence on farmland, etc.
18 (3) If property that includes a matrimonial home is normally used for a purpose other than residential, the matrimonial home is only the part of the property that may reasonably be regarded as necessary to the use and enjoyment of the residence. R.S.O. 1990, c. F.3, s. 18 (3).
What Constitutes a Farm under Part 1 of the Family Law Act?
11The terms farm or farmlands are not defined in the FLA. The limited caselaw dealing with family farms on separation does not address this definitional issue per se. I begin this analysis with a review of the principles of statutory interpretation as set out in the oft quoted authority Sullivan on the Construction of Statutes.1
12Sullivan traces the origins of the modern principle as an approach to statutory interpretation to Elmer Dreidger’s first edition of the Construction of Statutes in 1974, where he states:2
Today there is only one principle or approach, namely the words of an Act are to be read in their entire context, in their grammatical and ordinary sense harmoniously with the scheme of the Act, the object of the Act, and the intention of Parliament.
13This modern principle was first cited and applied by the Supreme Court in Re Rizzo Shoes Ltd. 1998 837 (SCC), [1998] 1 S.C.R. 27 at para. 21 and is now the starting point for any statutory interpretation exercise. It entails a multi-dimensional approach which includes an examination of ordinary meaning, as well as legislative intent.3
14In Canada Trust Co v. Canada 2005 SCC 54, [2005] 2 S.C.R. 601 at para.10, the Court elaborates this well established principle in this way:
The interpretation of a statutory provision must be made according to a textual, contextual and purposive analysis to find a meaning that is harmonious with the Act as a whole. When the words of a provision are precise and unequivocal, the ordinary meaning of the words play a dominant role in the interpretive process. On the other hand, where the words can support more than one reasonable meaning, the ordinary meaning of the words plays a lesser role. The relative effects of ordinary meaning, context and purpose on the interpretive process may vary, but in all cases the court must seek to read the provisions of an Act as a harmonious whole.
15The ordinary meaning of the word "farm" as defined by the Collins English Dictionary is “ an area of land, together with the buildings on it, that is used for growing crops or raising animals, usually in order to sell them.” The definition of farm in the Cambridge English Dictionary reads: “an area of land together with a house and buildings used for growing crops and/ or keeping animals as a business.” Lastly, the Oxford English Dictionary definition is “an area of land, and the buildings on it, used for growing crops and/ or keeping animals.”
16Notably, the Oxford Dictionary definition makes no reference to any commercial aspect whereas the Collins Dictionary definition includes that “usually” there is a commercial purpose. And in the Cambridge Dictionary, a farm is by its very definition a business enterprise. These definitional differences raise the question whether a farm, as referred to in Part 1 section 11(1) of the FLA, must have a business or commercial purpose. That section must be read together with sections 5(1), and 9 and the property scheme as whole.
17Section 5(1) directs the court to make a payment by one spouse to the other that amounts to one half of the difference between their respective net family properties. The calculation is driven by ownership and value. In Thibodeau v. Thibodeau, 2011 110 (ONCA), and Buttar v. Buttar, 2013 517 (ONCA), the Ontario Court of Appeal confirms that the court’s power under this section is to order an equalization payment and does not include the power to redistribute or divide properties in specie. Any powers under the FLA to delay the equalization payment, to provide a party entitled to such a payment with security pending that delay, or to vest title to a property owned by one spouse to the other spouse, as set out in section 9 of the Act, are limited to specific circumstances, after the equalization issue has been determined.
18The purpose of these powers is evident from a plain reading. Under section 9, the court is granted the power to delay partial or complete satisfaction of the equalization payment for up to maximum of ten years, to avoid causing hardship to the payor spouse. A variety of companion remedies are available to the court to protect the rights of the spouse to whom the delayed payment is owed. Section 9 also confers enforcement powers in relation to the owed equalization, including the partition and sale of property, or the transfer of property in trust to or vested in the other spouse. In sum, the purpose of this provision is to relieve against financial hardship arising from the equalization obligation, on terms, or to enforce the obligation, on terms. It provides extra remedies to both the entitled spouse and the obliged spouse in specified circumstances.
19Section 11(1) of the FLA serves to limit the scope of these powers in circumstances where there is an operating business or farm. This is the only section in the Part 1 of the FLA that refers to a farm. The court is directed to avoid making an order for sale or any other order, that would seriously impair operation, unless there is no alternative method of satisfying the obligation. Since the purpose or aim is to alleviate financial hardship arsing from the property related obligations, then the busines or farm in question must be engaged in commercial activity to be afforded these extra remedies. A hobby farm, for example, would be excluded from the ambit of these provisions. This interpretation comports with two of the three definitions provided in the ordinary meaning part of the analysis.
20Both parties provided the court with definitions of farm found elsewhere in provincial and federal legislation. Employing the modern principle of statutory interpretation outlined above to the meaning at issue here, it is not necessary for the court to look beyond the Family Law Act, to determine this definition.
21The modern principle requires the court to find a meaning that is harmonious with the Act as a whole. Therefore, I considered the use of the term farmland found elsewhere in the Act. Part II of the FLA deals exclusively with the matrimonial home, which is defined in section 18. Section 18(3) parses the residence and any property surrounding it necessary for its use and enjoyment from any remaining property which is normally used for other than residential purposes. This impacts rights of possession as well as valuation.
22This provision falls under the heading “Residence on Farmland etc.” According to Sullivan the use of headings as an aid to statutory interpretation is to “cast light on the purpose or scope of the provisions to which they relate.”4 In section 18 (3), the header helps resolve any ambiguity in the section that follows by giving an example, namely farmland, where a matrimonial home might be parsed in this way.
23The effect of this provision is compatible with the functional, commercial, definition of farm in section 11 adopted above. The separation of one piece of property based on use and purpose in section 18(3) supports the continuing functionality of a farm or other activity, without derogating from either spouse’s separate rights in relation to the matrimonial home. Sections 11 and 18(3) both preserve the farm or other enterprise on an operational level, albeit in different ways.
24Linda submits that a farm must be profitable to fit within the statutory definition. I disagree. Farm income can be variable from year to year, especially having regard to matters beyond the owner’s control such as the effect of weather conditions on livestock wellness or crop yield and the bottom line. In my view, so long as the intention or purpose of the farm enterprise is profit, the consideration of a farm’s profitability or viability takes place at the second stage of the inquiry, namely whether the specific farm at issue ought to attract the protections afforded under section 11.
25The historical evidence on profitability is lacking but William does explain that he and his family of origin have engaged in farming for decades. While William did engage in other employment in the agricultural field, based on the number of years he has been engaged in and committed to farming, I infer that he had the intention to make a profit and therefore the farm operation was a commercial enterprise rather than merely a hobby farm. Based on this analysis, I conclude that the parties’ so-called farm is indeed a farm within the meaning of the FLA.
Is the Woodlot a Farm or a Business?
26The ordinary meaning of the word “woodlot” is defined by the Collins English Dictionary, according to the British version as “an area restricted to the growing of trees” and, according to the US version, as “a piece of land on which trees are cultivated specifically as a source of firewood, lumber etc.” The Merriam-Webster Dictionary defines a woodlot as “a restricted area of woodland usually privately maintained as a source of fuel, posts and lumber. The Oxford English Dictionary definition is “an area restricted to the growing of trees.” None of these definitions make specific reference to the cultivation or harvesting of wood for a commercial purpose, and accordingly, the ordinary meaning rule is inadequate for resolving this definitional issue.
27It is common in rural areas for woodlots to be part of or adjacent to farmland. They may be used to support the farm operation by providing timber as fuel, fencing and building materials or as a separate commercial enterprise. Adopting a purposive approach to the definition of farm, arguably that term could be interpreted to encompass a broader range of activities than those described under the ordinary meaning rule, including, for example, fish farming or harvesting wood.
28Linda argues that the question of whether the woodlot is a farm for family law purposes should be answered by considering the Canada Revenue Agency Income Tax Folio S4-F-11-C1, Meaning of Farm and Farming Business. This folio discusses the definition of farm for income tax purposes and specifically discusses woodlots. It states: “To qualify as farming, the activity must involve the growth process and natural biological changes. For example, raising fish, even in highly artificial conditions, is normally farming since the end product is the result of natural growth.”
29This interpretation folio goes on to stipulate:
Whether the operation of a woodlot is a farming, logging, or other business, is a question of fact. If the business’ main focus is planting, nurturing and harvesting trees under a forest management or similar resource plan (in other words, managing the growth, health, quality and make up of the woodlot), it may be a farming business. If, on the other hand, the main focus of the business is logging or the production of timber, reforestation will not change that business into a farming operation. If a taxpayer has a woodlot which involves planting, caring for, and harvesting Christmas trees to sell, it is generally considered farming.
These differentiations are driven by income tax policy and are not helpful nor necessary in resolving the definitional question for family law purposes.
30The purpose of section 11 of the FLA is to avert or minimize hardship for spouses engaged in the operation of a business or farm. It was Linda’s evidence that William derives significant income from harvesting the woodlot and that he continued to do so post-separation, over her express objection. She estimates he derives as much as $50,000 in income yearly, partly in cash. Based on the woodlot’s commercial nature, it is clearly an operating business within the meaning of section 11. Even if I am wrong in that conclusion, and the woodlot ought to be classified as a farm, as William submits, it does not impact the outcome on the question of whether the property should be sold, at this time, because section 11 operates to provide equal protection to both farms and operating businesses.
Does Section 11 of the FLA Create a Complete Defence to Partition and Sale under the Partition Act?
31It is well established law that separated spouses may bring an application under the Partition Act to exercise their prima facie right to sell jointly held property, contemporaneously with claims brought under the Family Law Act. See Silva v Silva 1990, 6718 (ONCA). As the Court of Appeal states in Silva at pp.11-12, the FLA does not oust the jurisdiction of the Partition Act when dealing with jointly owned spousal property; the two statutes are not incompatible. It is only where “substantial rights in relation to the jointly owned property are likely to be jeopardized by an order for partition and sale, that an application under the Partition Act should be deferred until the matter is decided under the FLA.” Notably, the court’s discretion to decline partition is narrow and requires malicious, vexatious or oppressive conduct on the part of the applicant. See Latcham v. Latcham 2002 44960 (ONCA).
32This means, for example, where a spouse has a strong claim for exclusive possession of a jointly owned matrimonial home, or there are serious questions of ownership, the application for partition and sale will likely fail. The party resisting the partition application bears the onus of establishing what circumstances or claims justify the court’s refusal to grant an order for partition and sale. See Afolabi v. Fala 2014 1713 (ONSC) at para. 29.5
33William argues that section 11 operates as a complete bar to any partition application, prior to the determination of each party’s net family property and the corresponding equalization obligation. Such an interpretation would effectively deny every spouse who jointly owns a farm or business of the ability to ever access any equity in their jointly owned property under the Partition Act until after a final adjudication under the FLA, except where the parties come to their own settlement.
34I do not read section 11 as a provision which ousts the court’s jurisdiction to give effect to a joint owner’s prima facie right to partition. Section 11 must be read together with sections 9 and 10. Section 9 provides the court with enhanced payment and enforcement remedies for businesses and farms. When faced with a partition claim in these circumstances, the court’s task is to weigh the applicant’s right to partition and sale as against the likelihood that once the equalization is determined, the resisting spouse will succeed in achieving a section 9 remedy. This is the approach adopted in Silva where the court was called upon to balance the right of partition and sale of parties’ matrimonial home by one spouse, with the competing claim that its sale would jeopardize the other spouse’s request for an award that exceeded half the difference between the net family properties under section 5(6) of the FLA.
35The denial of any consideration of a partition application prior to trial in all cases of jointly owned businesses or farms also runs contrary to Rule 2 of the Family Law Rules, which provides that:
(2) The primary objective of these rules is to enable the court to deal with cases justly. O. Reg. 114/99, r. 2 (2).
(5) The court shall promote the primary objective by active management of cases, which includes,
(a) at an early stage, identifying the issues, and separating and disposing of those that do not need full investigation and trial;
(b) encouraging and facilitating use of alternatives to the court process;
(c) helping the parties to settle all or part of the case;
(d) setting timetables or otherwise controlling the progress of the case;
(e) considering whether the likely benefits of taking a step justify the cost;
(f) dealing with as many aspects of the case as possible on the same occasion; and
(g) if appropriate, dealing with all or any part of the case without requiring parties, witnesses or lawyers to attend in person on the basis of written documents or by using telephone or video technology, by way of an order under clause 1 (7.2) (i) or (i.1). O. Reg. 114/99, r. 2 (5); O. Reg. 152/21, s. 2.
36Rule 2(3) elaborates that the primary objective of dealing with cases justly is achieved by saving expense and time and by dealing with cases in ways that are appropriate to the importance and complexity of the issues. The rationale and need for these mandatory directives are echoed in the watershed decision of Hryniak v. Mauldin 2014 7 (SCC) where the Supreme Court was called upon to interpret the newly amended Rule 20 of the Rules of Civil Procedure and stated at paragraphs 4 and 43:
In interpreting these provisions, the Ontario Court of Appeal placed too high a premium on the “full appreciation” of evidence that can be gained at a conventional trial, given that such a trial is not a realistic alternative for most litigants. In my view, a trial is not required if a summary judgment motion can achieve a fair and just adjudication, if it provides a process that allows the judge to make the necessary findings of fact, apply the law to those facts, and is a proportionate, more expeditious and less expensive means to achieve a just result than going to trial.
The Ontario amendments changed the test for summary judgment from asking whether the case presents “a genuine issue for trial” to asking whether there is a “genuine issue requiring a trial”. The new rule, with its enhanced fact‑finding powers, demonstrates that a trial is not the default procedure.
37In Afolabi v Fala, the court applied this approach to the disposition of a family law case, when considering a partition application in the face of competing claims for lump sum spousal support, a vesting order and an unequal division of net family properties. The court framed the access to justice issue this way at paragraph 38:
The Supreme Court explained in Hryniak that while Rule 20 in the Ontario Rules of Civil Procedure goes further than other summary judgement rules in Canada; the values and principles relevant to its interpretation are of general application. In essence, the appropriate use of a motion for summary judgment under the (Ontario) Rules of Civil Procedure is an access to justice issue for parties to a civil action. I see no reason why parties to a family law case should not be accorded the same access to justice under the same principles. If anything, family law in Ontario cries out for the summary disposition of issues in appropriate circumstances as much as in any other area of law. This accessibility to timely, affordable justice is as important to the parties in conflict as it is to the confidence of citizens in our court system that cases will be adjudicated efficiently and effectively according to law.
Should the Properties be Sold?
38It is within this framework that I consider the sale of the farm property, namely the vacant 293 acre lot, which, on the date of separation had a small herd of cattle on it, consisting of 16 cows and one bull, having an estimated auction value of $25,000. William’s deficient and delayed disclosure reveals that in 2017, the year of separation, he claimed a net loss in relation to his farming income of $35,243 on his Income Tax Return. In 2018, the claimed loss for this line item on his ITR was $23,258.00. Further, on the date of separation the farm account had an overdraft of $63,403.13.
39It is Linda’s evidence that during their marriage William controlled the farm operation so she was unable to offer any concrete assessment of the farm’s historical profitability. She states the farm was a joint venture with the children’s active participation, that it was not lucrative and that sometimes it lost money. William’s evidence does not address this issue squarely either. What he does tell the court in his affidavit sworn May 5, 2021, is that since separation, he has normally sold off approximately 16 steers or calves in any given year and has, since separation, “been working towards building up a herd towards profitability.” The only evidence before the court is that this farm operation was not profitable at separation or afterwards and any future profitability is purely speculative.
40Importantly, the effect of the farm losses is to drastically reduce William’s line 150 income. Without these losses he has a combined pension income from which to discharge any spousal support obligation; with these losses he does not, unless there is an income adjustment made for spousal support purposes. In sum, the farm operates less as a viable commercial enterprise worthy of long-term protection afforded under section 9 of the Act, than as a vehicle for reducing William’s income tax liability, while he also attempts to insulate himself from the payment of spousal support.
41William is not seeking an order for an installment schedule for any equalization payment or indeed any other remedy under section 9. Rather he is asking that he be granted the opportunity to purchase Linda’s interest in the property. Almost 30 years ago, the Ontario Court of Appeal concluded that a spouse does not enjoy the right to purchase the other spouse’s interest in jointly owned property under the Family Law Act. See Martin v Martin 1992 7402 (ONCA).
42More recently, in Buttar v Buttar, 2013 517 (ONCA), the court had the opportunity to reaffirm this conclusion and overturned a trial judge’s decision to redistribute the parties’ jointly owned assets with the aim of preserving their farming operations. The OCA at paragraph 64 cites it own decision in Martin where it “jealously guarded the rights of joint owners to the best price for jointly-owned property”, noting the effect of the trial judge’s order was to deprive the appellant of that right to the highest price.
43That court, at paragraph 63, went on to cite Granger J. in Batler v. Batler:
A joint tenant is entitled to the highest price for his or her interest which may be more than the appraised value of the property. In today's real estate market, the appraised value of the property may not reflect the fair market value. The true test of the fair market value is to sell the property in an open market. Unless the parties agree to a transfer of the property at an agreed price, the property should be listed for sale and sold, to ensure that fair market value is obtained.
44Linda tendered an affidavit from Ray Krupa, a licensed real estate agent in the Bancroft area for the past 17 years. He is currently a licensed real estate broker and is the owner and broker of record of the Century 21 All Seasons Realty Limited Brokerage located in Bancroft ON. He gave evidence that real estate values in the Bancroft area are very high and, further, that the Canadian Real Estate Association indicates that average real estate values have increased 42.4% in the Bancroft area between March 2020 and March 2021. According to Mr. Krupa, properties, including farms and farmlands, are often selling for significantly above values recommended by local realtors.
45Linda and William do not agree on the value of the farm. Even if they jointly obtained a certified appraisal, in the current market it is very likely that the actual selling price would be higher than any appraised value. Linda insists on her right to try to fetch the highest price in keeping with the principles enunciated in Martin, and Buttar. See also Jantzen v Jantzen, 2019 3532 (ONSC), where Sproat J. denied a wife's request to vest title to a farm in her name alone based on the expert’s value because an appraisal does not tell us the true value of the farm. The only way for Linda to achieve her right to the highest, best price is for this property to be listed for sale forthwith.
46I turn now to the woodlot property, which is approximately 56 acres a vacant land consisting of mixed trees and brush. William claims that he is the beneficial owner of the woodlot, which is held in Linda's name alone. At first blush, this fact favours delaying any sale until the ownership issue is adjudicated. But a motion for partition and sale is essentially a summary judgment motion. This requires the defending party to put his or her best foot forward, which is to say that William, who is resisting the sale, bears the onus of demonstrating, on the best available evidence, why he is the sole beneficial owner of this property.
47As pointed out by Linda, his evidence on this does not make sense having regard to the chronology of the acquisitions of the various properties. According to Linda's evidence, the parties purchased the woodlot in November 1999 from the Estate of Beulah White, Williams mother, for the full appraised value of $22,500, with funds from the parties’ joint account. This lot was taken in the name of Linda alone to avoid issues relating to severance because of its proximity to other jointly owned property. This is supported by documentary evidence. In 2010, the parties severed a building lot from the woodlot and gifted it to Linda's daughter Tanya and her spouse.
48William, on the other hand, claims that he purchased the woodlot with funds that can be traced to a gift of Lot 12, Concession 7. The documentary evidence is inconsistent with this claim. William also fails to reconcile how the parties could have sold that property to finance the purchase of the woodlot in 2003, as he claims, when they had in fact already purchased it some four years earlier.
49Justice Malcolm granted the parties permission to conduct a questioning in January of this year, when this motion was scheduled as a long motion well in advance of it being heard. There was ample opportunity for William to cross-examine Linda on her affidavit material. There was ample time to produce documentation to substantiate his narrative regarding the acquisition of this and other properties, to support his claim that he is the sole beneficial owner of the woodlot. William did not avail himself of these opportunities to challenge Linda's evidence or put better evidence before the court. In sum, William has failed to provide evidence to substantiate his ownership claim. Further, he has failed to rebut the presumption that Linda is entitled to partition and sale under the test set out in Latcham.
CONCLUSION
50So long as a farmer is engaged in farming with the intent to make a profit, the farm shall be considered a farm under the Family Law Act. Section 11 of the FLA is not a complete defence to a motion for partition and sale under the Partition Act. Rather, the likelihood that the remedies available to parties under section 9 might apply in any particular case must be balanced against the moving spouse’s right to sell a jointly owned businesses or farm and to do so in a manner that achieves the highest market value.
51On the facts here, the farm is insufficiently profitable and viable to attract any section 9 remedies. Further, a delayed sale deprives Linda of the best price. The evidence supports the conclusion that, although title to woodlot is in the name of Linda only, she holds a half interest in trust for William. Since William has failed to show that section 9 remedies are likely to apply to the woodlot and has failed to rebut Linda’s presumptive right to partition and sale, both the farm property and the woodlot shall be listed for sale immediately. It is open to William to bid or make offers to purchase in the open market along with other prospective purchasers.
Released: September 13, 2021
